What hath SCOTUS wrought?

[Brad Gile]

The eminent domain case has gone nuts! The people whose property is being confiscated will now have to pay 5 years back rent?
http://fairfieldweekly.com/gbase/New...oid=oid:119000

Originally Posted by fairfield county weekly

A New (London) Low
A refrigerator box under the bridge: The Kelo Seven prepares for the worst

by Jonathan O'Connell - July 14, 2005
Those who believe in the adage "when it rains, it pours" might take the tale of the plaintiffs in Kelo v. New London as a cue to buy two of every animal and a load of wood from Home Depot. The U.S. Supreme Court recently found that the city's original seizure of private property was constitutional under the principal of eminent domain, and now New London is claiming that the affected homeowners were living on city land for the duration of the lawsuit and owe back rent. It's a new definition of chutzpah: Confiscate land and charge back rent for the years the owners fought confiscation.

In some cases, their debt could amount to hundreds of thousands of dollars. Moreover, the homeowners are being offered buyouts based on the market rate as it was in 2000 .

The hard rains started falling that year, when Matt Dery and his neighbors in Fort Trumbull learned that the city planned to replace their homes with a hotel, a conference center, offices and upscale housing that would complement the adjoining Pfizer Inc. research facility.

The city, citing eminent domain, condemned their homes, told them to move and began leveling surrounding houses. Dery and six of his neighbors fought the takeover, but five years later, on June 23, the downpour of misfortune continued as the U.S. Supreme Court ruled 5-4 that the city could claim the property for economic development.

Dery owns four buildings on the project site, including his home and the birthplace and lifelong home of his 87-year-old mother, Wilhelmina. Dery plans to make every remaining effort to keep his land, but with few legal options remaining, he's planning for the worst.

And for good reason. It's reasonable to think that people who purchased property years ago (in some cases, decades ago) would be in a position to cash in, especially since they're being forced from their homes. But that's not the case.

The New London Development Corp., the semi-public organization hired by the city to facilitate the deal, is offering residents the market rate as it was in 2000, as state law requires. That rate pales in comparison to what the units are now worth, owing largely to the relentless housing bubble that has yet to burst.

"I can't replace what I have in this market for three times [the 2000 assessment]," says Dery, 48, who works as a home delivery sales manager for the New London Day . He soothes himself with humor: "It's a lot like what I like to do in the stock market: buy high and sell low."

And there are more storms on the horizon. In June 2004, NLDC sent the seven affected residents a letter indicating that after the completion of the case, the city would expect to receive retroactive "use and occupancy" payments (also known as "rent") from the residents.

In the letter, lawyers argued that because the takeover took place in 2000, the residents had been living on city property for nearly five years, and would therefore owe rent for the duration of their stay at the close of the trial. Any money made from tenantssome residents' only form of incomewould also have to be paid to the city.

With language seemingly lifted straight from The Goonies , NLDC's lawyers wrote, "We know your clients did not expect to live in city-owned property for free, or rent out that property and pocket the profits, if they ultimately lost the case." They warned that "this problem will only get worse with the passage of time," and that the city was prepared to sue for the money if need be.

A lawyer for the residents, Scott Bullock, responded to the letter on July 8, 2004, asserting that the NLDC had agreed to forgo rents as part of a pretrial agreement in which the residents in turn agreed to a hastened trial schedule. Bullock called the NLDC's effort at obtaining back rent "a new low."

"It seems like it is simply a desperate attempt by a nearly broke organization to try to come up with more funds to perpetuate its own existence," Bullock wrote. He vowed to respond to any lawsuit with another.

With the case nearly closed, the NLDC may soon make good on its promise to sue. Jeremy Paul, an associate UConn law dean who teaches property law, says it's not clear who might prevail in a legal battle over rent. "From a political standpoint, the city might be better off trying to reach some settlement with the homeowners," he says.

An NLDC estimate assessed Dery for $6,100 per month since the takeover, a debt of more than $300K. One of his neighbors, case namesake Susette Kelo, who owns a single-family house with her husband, learned she would owe in the ballpark of 57 grand. "I'd leave here broke," says Kelo. "I wouldn't have a home or any money to get one. I could probably get a large-size refrigerator box and live under the bridge."

That's one way to get out of the rain.

Brad

[Incredible Hulctuary]

The New London Development Corp., the semi-public organization hired by the city to facilitate the deal, is offering residents the market rate as it was in 2000, as state law requires.

Merely offering market rate should be considered inadequate for "just compensation", and therefore the state law would be unconstitutional. Surely the "just compensation" should include moving costs as well as a premium for being involuntarily uprooted. I wonder why that line of reasoning wasn't argued in front of the SCOTUS (or if it was argued, why they didn't accept it). Unless there actually was a premium involved that wasn't mentioned.

But anyway, that back rent thing is utterly ridiculous.

[krank]

this is disgusting

[Brad Gile]

Originally Posted by krank

this is disgusting

Savor this moment, krank. We are 100% in agreement here.

Brad

[krank]

Originally Posted by Brad Gile

Savor this moment, krank. We are 100% in agreement here.

Brad

tastes bad

Scay-REE!

[fallout]

The rent brings a more human element to it, but the scary part was already over, when the gov't seized homes for redistribution.

It really is not that different from many of us on this board that complain about the government seizing income purely for redistribution, just on a grander scale.

[MountainHawk]

Originally Posted by fallout

The rent brings a more human element to it, but the scary part was already over, when the gov't seized homes for redistribution.

It really is not that different from many of us on this board that complain about the government seizing income purely for redistribution, just on a grander scale.

It's different in the sense that taxes typically rob the rich to give to the poor, while the most obvious applications of this will rob the poor to give to the rich. What ... turnabout isn't fair play?

(I'm kidding of course, I think this is horrendous law.)

[Mayor Quimby]

So is ANYONE in favor of the ruling in this case, outside of 5 SCOTUS judges and the city leaders and builders who are set to profit from it? This is why the judicial system is screwed up, five people overrule everyone else.

Of course, who were the four judges that thought this was a horrendously bad idea? Thomas, Scalia, O'Connor, and Rehnquist. I'd like to know what the heck Kennedy was thinking. But it's typical of what we expect from Souter, Ginsburg, Breyer and Stevens...anything to make government more powerful.

[MountainHawk]

Probably contractors/builders like this ruling too. But that's about it. I have to think Congress will act on this eventually. Property rights are too critical to a functional society to be unstable for long.